Following April's bloodbath to five year lows, housing starts and permits were expected to rebound V-like in May (despite lockdowns being in full swing that month). And as we suspected, the data disappointed with a massive miss in Housing Starts (+4.3% MoM vs +23.5% MoM expected). Building Permits rebounded more than Starts but also disappointed (rising 14.4% MoM against expectations of a 16.8% surge).
On an aggregate basis, it's clear the "V" was disappointing...
Both single- (+11.9%) and multi-family (+18.3%) permits rebounded...
Single-family starts barely rose at all in May (+0.1%), hovering near their lowest since March 2015. Multi-family starts rose 16.9% MoM...
All driven by a huge surge in The West (amid quarantine):
Finally, we note that these moves in forward-looking permits come as mortgage purchase applications continue to soar...
Is this just pent up demand in the usual seasonally strong sales period? And, or are homebuilders far less confident than their "sentiment" index would suggest about the "V"?